This time we find Wells Fargo and Chase on the receiving end of yet another lawsuit. Some Los Angeles based attorneys filed a class action alleging that Chase and Wells Fargo illegally levied excessive and deceptive default service fees against late paying loan borrowers.
The suit claims that the two banks cheated hundreds of thousands of borrowers by charging abusive default fees. According to the suit, the excessive fees ranged from $20 to $135. The banks listed these fees on the borrowers’ monthly statement as “Other Charges,” “Miscellaneous Fees” or “Corporate Advances.”
The banks used one of these fees to hire real estate agents to perform a BPO. Federal law allows lenders to charge for these BPO fees however they cannot mark up the charges and make a profit. The lawsuit claims that the banks did indeed make significant profits from these fees.